AppLovin's Fundamentals Keep Ripping, but Competitive Threats and SEC Investigation Still Exist

AppLovin is a vertically integrated advertising tech company that acts as a demand-side platform for advertisers, a supply-side platform for publishers, and an exchange that facilitates transactions between the two. The firm initially focused on mobile game advertising and monetization, but soon identified a broader need for enhanced user acquisition and optimization tools across content types. AppLovin provides advertisers access to 1.6 billion daily active users. Following the divestment of its gaming studios in early 2025, it is now a pure-play ad tech platform. The company is growing rapidly and has a strong margin profile, earning it the highest Rule-of-40 score in our software universe.